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AL Khobar co. entity want to produce part (W) which represents a major component of the final product (T).currently the entity purchase that part from

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AL Khobar co. entity want to produce part (W) which represents a major component of the final product (T).currently the entity purchase that part from a specialized suppliers at a price of SR 8 per unit, you were asked as a managerial accountant to established an analytical study to help in differentiation between the production of this part or continue to purchase from suppliers instead, under the following information: The estimation cost for the production for the next year is 20.000 unit were as follows: Direct material SR 10,000 Direct wages SR 90,000 Variable costs SR 40,000 Fixed costs SR 60,000 Electricity costs 5000 Required: would you recommend the entity to stop buying this part of product or manufacture it, support your answer mathematically

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